Results and Reports

Half Year Results

21 November 2017

De La Rue has performed well in the first half, driven by strong growth in the Currency business and we have continued to make good progress against our strategic plan.

  • Revenue +29% and adjusted operating profit*(1) +11%, reported operating profit +7%
  • Currency business delivered strong growth with revenue +36% and adjusted operating profit*(1) +16%, driven by high volumes
    • Banknote Paper volume +36% to 7,200 tonnes
    • Banknote Print volume +6% to 3.5bn notes
    • Polymer volume +570% to 400 tonnes
  • Identity Solutions and Product Authentication revenues +3% and +20%, respectively
  • Adjusted basic earnings per share +19% to 16.6p
  • Net debt £137.4m, up £16.5m from the year end due to higher working capital
  • Group 12 month order book of £363m as at September 2017
  • Increased investment in product development
    • R&D investment increased by 33% year on year
    • Joint product development and exclusive sales agreement with security features developer and manufacturer Opalux
  • Polymer momentum continues - signed 10 year contract to supply Safeguard® substrate for Bank of England new £20 notes
  • DLR Analytics™ launched in May gaining further traction, with 60 central banks signed up
  • Joint development agreement with Note Printing Australia for new Australian passport
  • De La Rue Authentication Solutions (previously DuPont Authentication) is performing to plan
  HY
2017/18
£m
HY
2016/17
£m
Change
%
Revenue  244.7 189.5  +29%
   Currency 185.3 136.4 +36%
   Identity Solutions 39.4 38.1 +3%
   Product Authentication & Traceability 20.2 16.9 +20%
Adjusted operating profit*(1) 26.6 24.0 +11%
Reported operating profit 24.6 23.0 +7%
EPS basic adjusted*(2) 16.6p 14.0p +19%
EPS basic reported 14.8p 13.2p +12%
Dividend per share 8.3p 8.3p 0%


*This is a non-IFRS measure. Amortisation of acquired intangible assets is a non-cash item while exceptional items are non-recurring in nature. By excluding these items from the adjusted operating profit and EPS metrics, the Directors are of the opinion that these measures give a better understanding of the underlying performance of the business. “Reported” measures are on an IFRS basis. See page 26 for further explanations and reconciliation to the comparable IFRS measures.

(1) Excludes exceptional item net charges of £1.8m (H1 2016/17: £1.0m) and amortisation of acquired intangible assets of £0.2m (H1 2016/17: £nil).

(2) Excludes exceptional item charges of £1.8m (H1 2016/17: £1.0m), amortisation of acquired intangible assets of £0.2m (H1 2016/17: £nil) and related tax credits of £0.2m (H1 2016/17: £0.2m). 

Revenue and adjusted operating profit growth rates for the Identity Solutions and Product Authentication & Traceability reflect a change in allocation of results for these segments made in the year. See more information in Note 2 on pages 19 to 20.

Martin Sutherland, Chief Executive Officer of De La Rue, commented:

“De La Rue has performed well in the first half, driven by strong growth in the Currency business and we have continued to make good progress against our strategic plan.

“Polymer has reached a significant milestone with the award of a 10 year contract to supply our polymer substrate Safeguard® for the Bank of England’s new £20 note. DLR Analytics, our cash cycle management software launched in May this year, has gained more traction. More than 60 central banks have now signed up to the pilot programme, further strengthening De La Rue’s position in the industry.

“R&D investment has increased by 33% in the first half as we continue to invest in new products and capabilities. Product Authentication grew by 20%, driven by De La Rue Authentication Solutions which is performing to plan.

“The strong revenue growth in the first half, driven by high volumes of lower margin Banknote Paper and Print orders, reflects the lumpy nature of contracts. Performance in the second half is expected to be broadly in line with the same period last year. Overall, our outlook for the year remains unchanged.”

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